The Reserve Bank of India (RBI) has cancelled the licence of Uttar Pradesh-based United India Co-operative Bank.

Consequently, the bank (Nagina, Bijnor, Uttar Pradesh) will cease to carry on banking business with effect from the close of business on July 19, 2023, according to a RBI statement.

The central bank said the Commissioner and Registrar of Cooperatives, Uttar Pradesh, has also been requested to issue an order for winding up the bank and appointing a liquidator for it.

“On liquidation, every depositor would be entitled to receive deposit insurance claim amount of his/ her deposits up to a monetary ceiling of ₹5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC) subject to the provisions of the DICGC Act, 1961.

“According to data submitted by the bank, 99.98 per cent of the depositors are entitled to receive the full amount of their deposits from DICGC,” RBI said.

RBI noted that the bank does not have adequate capital and earning prospects and has failed to comply with the requirements of relevant Sections of the Banking Regulation Act, 1949.

“The continuance of the bank is prejudicial to the interests of its depositors; in its present financial position, the bank would be unable to pay its present depositors in full; and public interest would be adversely affected if the bank is allowed to carry on its banking business any further,” according to the central bank.

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